Bitcoin exchange Bitfloor attempts comeback after $250,000 heist

Founder hopes to earn enough profits to repay stolen client funds.

Bitfloor, a fast-growing Bitcoin exchange that was felled by a security breach earlier this month, has resumed operations. Founder Roman Shtylman announced the site's revival on Google Plus.

The exchange lost Bitcoins valued at about $250,000 in the heist. As a result, Bitfloor was incapable of repaying clients who had deposited Bitcoins, forcing the site to suspend operations. Bitfloor still lacks the funds to repay those users, so it has officially designated those funds as "on hold."

"Your balance as of the theft will remain on hold and be released in parts as we begin to recover funds to pay back balances," the post says. "As funds are available for repayment, they will be dispersed on a pro-rated basis."

In an interview with IDG, Shtylman said he has reported the theft to the FBI, and that he was determined to earn enough profits to make his long-suffering customers whole.

To ensure that client funds are not lost again, Bitfloor has committed to keeping client Bitcoins in "cold storage," meaning on computers or media not directly connected to the Internet. Day-to-day trading will be performed using a "hot wallet" containing Bitfloor's own funds. Shtylman says this guarantees that even if the site were hacked again, no more client funds would be lost.

Some Bitfloor users whose funds were lost have tried to cash out by selling their frozen assets at a discount. One user reportedly succeeded in selling 200 frozen Bitcoins (approximately $2450) for 70 percent of their face value.

The value of Bitcoins is volatile, but it has been trending upwards in recent months, rising from about $5 in June to more than $12 today.

The people stupid enough to buy Bitcoin deserve to be grifted of their money, and now those stupid enough to go back into Bitfloor deserve the coming theft of their money, which is sure to occur.

Bitcoin is an excellent "lemming award" type evolutionary mechanism to relieve the idiotic of their wealth.

You may consider me a "lemming" but I prefer the term "early adopter." I believe bitcoin is more revolutionary than evolutionary, but you are free to stand by as a spectator and watch the action from a safe distance. I can tell you are a very cautious investor and I'm sure you're happy that you were prescient enough to avoid losing any money back in 2008 when the central banking systems of both the U.S. and Europe reached the edge of the cliff and many idiotic citizens were relieved of their wealth by the oh-so-clever bank executives. You're much too smart to fall into that kind of trap, aren't you?

THe people stupid enough to buy Bitcoin deserve to be grifted of their money, and now those stupid enough to go back into Bitfloor deserve the coming theft of their money, which is sure to occur.

Bitcoin is an excellent "lemming award" type evolutionary mechanism to relieve the idiotic of their wealth.

Bitcoins have a pretty safe future so long as they continue to be trustworthy in terms of not allowing double transactions. As far as everyone knows, this is still true. If absolutely nothing else, BitCoin are a fantastic medium for black and grey market trades. You don't have to hold onto the coins for years, just the 30 seconds it takes to make the exchange. The actual face value of the coins mean nothing in those transactions. As long as those transactions exist, the currency has real value and people willing to hold coins are not entirely insane because there is a demand for the coins. It is a risky investment, but if I had bought some when I first heard of them, I would be 15x richer.

If absolutely nothing else, BitCoin are a fantastic medium for black and grey market trades.

Beyond the oddball legit transaction, I suspect that's going to remain it's primary use. From what I have read, it's just too unsuitable for adoption as a national currency. Economically speaking as well, not just for the downsides from the government view of cryptocurrency.

If absolutely nothing else, BitCoin are a fantastic medium for black and grey market trades.

Beyond the oddball legit transaction, I suspect that's going to remain it's primary use. From what I have read, it's just too unsuitable for adoption as a national currency. Economically speaking as well, not just for the downsides from the government view of cryptocurrency.

Some analysts disagree. There are businesses in Europe that have lost faith in the stability of the euro to the point that bitcoin is looking like a viable alternative..

Beyond the oddball legit transaction, I suspect that's going to remain it's primary use. From what I have read, it's just too unsuitable for adoption as a national currency. Economically speaking as well, not just for the downsides from the government view of cryptocurrency.

If you have ever tried to send funds internationally, the low overhead and speed of bitcoin is very attractive.

On the topic of national currency, it is by nature international, and yet has reached a money supply measure as large or larger than 8 nations in just over a year since starting to be really used. Pretty good start, but too early to tell where it will end up.

From the economics standpoint, there are different functions for money. One is as a "medium of exchange". Bitcoin is well designed for that, being low friction and electronic. Another is "store of value". Bitcoin was *not* designed for that function, it does not have a built in asset base or means to stabilize it's exchange value. Therefore it fluctuates like commodities (oil, gold) or stocks. Since it was not designed as a store of value, I would not expect it to function as one, and would not use it for that purpose.

So my advice is to keep bitcoins long enough to finish your transactions, but for storage of value, convert them to something long term.

Trustfunds etc. looking for safe havens has been using the Swiss Franc and the Danish Krone, not the Bitcoin, that would be moronic. The Bitcoin fluctuates a lot, and institutions searching for a safe haven wants the opposite.

edit:

The Danish Krone is locked to the Euro, so it fluctuates with the Euro. But historically the Krone was locked to the Deutch Mark. So I gather institutions, probably correctly so, figures that in the event of the Euro collapsing, the Danish Krone would exist in a limbo for a while until it could lock itself to the new DM instead (since the Danish economy is stable both short and long term, and is only locked by choice to the Euro).

Trustfunds etc. looking for safe havens has been using the Swiss Franc and the Danish Krone, not the Bitcoin, that would be moronic. The Bitcoin fluctuates a lot, and institutions searching for a safe haven wants the opposite.

You are being kind.

Bitcoins have a market cap of 123 million US dollars. To make enough money even with the highly volatile bitcoin that would make a hedge fund or currency trader even bother would cause a huge price spike. A small 500k position is almost 140 percent the average daily trading volume.

To give you an idea on insignificant Bit coins is and how people are not moving their Euros over the smallest Eurozone country Malta GDP is only about 63 times larger then all of the Bitcoins in the world yet its only 400k people. Greece is 2150 times larger.

Quote:

edit:

The Danish Krone is locked to the Euro, so it fluctuates with the Euro. But historically the Krone was locked to the Deutch Mark. So I gather institutions, probably correctly so, figures that in the event of the Euro collapsing, the Danish Krone would exist in a limbo for a while until it could lock itself to the new DM instead (since the Danish economy is stable both short and long term, and is only locked by choice to the Euro).

The Krone advantage over the Euro despite the peg is its not the Euro and the Danes can float it in the future and have the ability to print. This why its a safe haven right now as there is a 0 percent chance the Danes can have a technical default it would only be politics that would allow a default (read not floating the Krone and/or printing).

Bitcoins have a market cap of 123 million US dollars. To make enough money even with the highly volatile bitcoin that would make a hedge fund or currency trader even bother would cause a huge price spike. A small 500k position is almost 140 percent the average daily trading volume.

To give you an idea on insignificant Bit coins is and how people are not moving their Euros over the smallest Eurozone country Malta GDP is only about 63 times larger then all of the Bitcoins in the world yet its only 400k people. Greece is 2150 times larger.

Total value of all bitcoins does not have an upper limit relative to US dollars, or any other currency.

There will be an absolute maximum of 21 million bitcoins, which are extremely divisible units. If bitcoins become more widely used, their value will rise relative to other currencies. The result could be discussing prices in terms of milli-bitcoins or micro-bitcoins, which would present no problem.

This means that the market cap expressed in your own currency would rise as the demand for bitcoins rises. A current market value in yuan (or any other preferred currency) presents no limit on the future market value of all bitcoins.

Bitcoins have a market cap of 123 million US dollars. To make enough money even with the highly volatile bitcoin that would make a hedge fund or currency trader even bother would cause a huge price spike. A small 500k position is almost 140 percent the average daily trading volume.

To give you an idea on insignificant Bit coins is and how people are not moving their Euros over the smallest Eurozone country Malta GDP is only about 63 times larger then all of the Bitcoins in the world yet its only 400k people. Greece is 2150 times larger.

Total value of all bitcoins does not have an upper limit relative to US dollars, or any other currency.

There will be an absolute maximum of 21 million bitcoins, which are extremely divisible units. If bitcoins become more widely used, their value will rise relative to other currencies. The result could be discussing prices in terms of milli-bitcoins or micro-bitcoins, which would present no problem.

This means that the market cap expressed in your own currency would rise as the demand for bitcoins rises. A current market value in yuan (or any other preferred currency) presents no limit on the future market value of all bitcoins.

And this has nothing to do with the current bitcoin market in reference to the articles making a claim they are Europeans using bitcoin as a safe haven. As it currently stands even a small position in bitcoins by a HNWI let alone a hedge fund or currency trader is going to dramatically effect the market. The bit coin markets have yet to see anything close to this kind of movement hence its not an actual thing people using bitcoins as a safe haven. 1 dude does not make this anything but 1 dude that is crazy.

Bitcoins have a market cap of 123 million US dollars. To make enough money even with the highly volatile bitcoin that would make a hedge fund or currency trader even bother would cause a huge price spike. A small 500k position is almost 140 percent the average daily trading volume.

To give you an idea on insignificant Bit coins is and how people are not moving their Euros over the smallest Eurozone country Malta GDP is only about 63 times larger then all of the Bitcoins in the world yet its only 400k people. Greece is 2150 times larger.

Total value of all bitcoins does not have an upper limit relative to US dollars, or any other currency.

There will be an absolute maximum of 21 million bitcoins, which are extremely divisible units. If bitcoins become more widely used, their value will rise relative to other currencies. The result could be discussing prices in terms of milli-bitcoins or micro-bitcoins, which would present no problem.

This means that the market cap expressed in your own currency would rise as the demand for bitcoins rises. A current market value in yuan (or any other preferred currency) presents no limit on the future market value of all bitcoins.

And this has nothing to do with the current bitcoin market in reference to the articles making a claim they are Europeans using bitcoin as a safe haven. As it currently stands even a small position in bitcoins by a HNWI let alone a hedge fund or currency trader is going to dramatically effect the market. The bit coin markets have yet to see anything close to this kind of movement hence its not an actual thing people using bitcoins as a safe haven. 1 dude does not make this anything but 1 dude that is crazy.

This is the difference between discussing the short-term situation, or discussing possible broader uses in the future.

In the longer term, it's reasonable to discuss the possibility of bitcoins as something more than a convenient tool for short-term transactions.

None of this means that some Europeans do not currently use bitcoins as a safe haven. The state of the market just indicates that they are not extremely wealthy Europeans.

THe people stupid enough to buy Bitcoin deserve to be grifted of their money, and now those stupid enough to go back into Bitfloor deserve the coming theft of their money, which is sure to occur.

Bitcoin is an excellent "lemming award" type evolutionary mechanism to relieve the idiotic of their wealth.

I see you, or people like you, making the same comment again and again.

Do you care elaborating about what you think the problem with Bitcoin is, and what Bitcoins have done to you? Or do you just like trolling?

The value of a currency is leveraged on the collective productive power of the sovereign state or organization that issues it. Even without a material standard such as gold or territory, currencies from nation states and other corporative structures have tangible incentives for stability and value increase (e.g. large numbers of living citizens/employees/members, food demand, trade, transportation). Bitcoin is nothing but a speculative fantasy, like collateralized debt obligations and mortgage backed asset traunches and other such imaginary (termed in the industry parlance "exotic") products that increase volatility with no demonstrable real value-add or credible backing.

In short: it matters that sovereign nations guarantee their currencies. It's not arbitrary.

The value of a currency is leveraged on the collective productive power of the sovereign state or organization that issues it. Even without a material standard such as gold or territory, currencies from nation states and other corporative structures have tangible incentives for stability and value increase (e.g. large numbers of living citizens/employees/members, food demand, trade, transportation). Bitcoin is nothing but a speculative fantasy, like collateralized debt obligations and mortgage backed asset traunches and other such imaginary (termed in the industry parlance "exotic") products that increase volatility with no demonstrable real value-add or credible backing.

In short: it matters that sovereign nations guarantee their currencies. It's not arbitrary.

It matters that millions of individuals make billions of economic decisions every day that have ramifications in the broader market. The currencies of many "sovereign nations" are just as arbitrary (and imaginary) as bitcoin, but can be manipulated by central banking authorities to benefit powerful interests. Bitcoin is immune to this kind of manipulation because it is controlled by mathematics, logic and a widely distributed network of independent nodes, not by a cabal of scheming scoundrels.

This is the difference between discussing the short-term situation, or discussing possible broader uses in the future.

In the longer term, it's reasonable to discuss the possibility of bitcoins as something more than a convenient tool for short-term transactions.

None of this means that some Europeans do not currently use bitcoins as a safe haven. The state of the market just indicates that they are not extremely wealthy Europeans.

I am sure their are Europeans that are using pokemon cards as a safe haven or rusted bikes. About the same number as using bitcoins but no one is writing a story about that or talking about these things as the future of commerce and for good reason the number of people doing this is so small they don't have any economic impact at all.

The value of a currency is leveraged on the collective productive power of the sovereign state or organization that issues it. Even without a material standard such as gold or territory, currencies from nation states and other corporative structures have tangible incentives for stability and value increase (e.g. large numbers of living citizens/employees/members, food demand, trade, transportation). Bitcoin is nothing but a speculative fantasy, like collateralized debt obligations and mortgage backed asset traunches and other such imaginary (termed in the industry parlance "exotic") products that increase volatility with no demonstrable real value-add or credible backing.

In short: it matters that sovereign nations guarantee their currencies. It's not arbitrary.

It matters that millions of individuals make billions of economic decisions every day that have ramifications in the broader market. The currencies of many "sovereign nations" are just as arbitrary (and imaginary) as bitcoin, but can be manipulated by central banking authorities to benefit powerful interests. Bitcoin is immune to this kind of manipulation because it is controlled by mathematics, logic and a widely distributed network of independent nodes, not by a cabal of scheming scoundrels.

Hahahahahahahaha.

What scare quote Sovereign nation scare quote has a currency just as arbitrary as bitcoin? If a country accepts the currency as payment for taxes then bam its not as imaginary as bitcoin.

You kidding me about Bitcoin? Its logical to follow a currency design that only lead to a deflationary period on average every 5 years?